Inside the Data Center

Potential Economic Effect of a Flu Pandemic

Much is heard in the news these days about avian flu and the potential
of a flu pandemic. By the middle of January 2006, the issue had pushed
its way to the home pages of many prominent websites, including those
of the White House, the U.S. Department of Health and Human Services,
the Centers for Disease Control and Prevention (CDC), the World Health
Organization (WHO) and the Indiana State Department of Health. The
federal government has even created a website dedicated to the issue
(www.PandemicFlu.gov).

The October 7, 2005, issue of Science reported that researchers from
the CDC and their colleagues were able to reconstruct the flu virus that
caused the flu pandemic that killed upwards of 50 million people worldwide
(an estimated 675,000 in the United States) in 1918–19. There were
two other flu pandemics in the 20th century (1957 and 1968) but neither
was as deadly as the 1918 pandemic (see Figure 1 and Table
1).

Figure 1: Hoosier Deaths due to Influenza, 1917 to 1921

Table 1: Hoosier Influenza Deaths

The "Report of the State Board of Health For the Year Ending September
30, 1919," (1) shows that the flu epidemic was first recognized about
September 20, 1918, spreading to every corner of the state by October
20. The epidemic reached a maximum about October 25 and then declined
until about November 15 when a second recurrence began, ending by January
1, 1919. On October 9, schools, churches and theaters were ordered closed
and public gatherings were forbidden. This order was lifted on November
2 when officials realized that the closings had very little effect in
controlling the spread of the flu. By the end of the epidemic, a total
of $8,269.09 was spent by the federal government in Indiana to help control
the epidemic (or over $90,000 when adjusted for inflation).

A 1999 CDC report estimated that a flu pandemic in the United States
could result in 89,000 to 207,000 deaths; 314,000 to 734,000 hospitalizations;
and 18 to 42 million outpatient visits. The authors estimated that the
impact to the economy would be anywhere from $71.3 to $166.5 billion,
excluding disruptions to commerce and society.

More recently, a December 2005 Congressional Budget Office report discusses
two economic impact scenarios of a potential avian flu pandemic. In the
most severe scenario, one similar to the 1918–19 outbreak, about
90 million people would fall ill and 2 million would die in the United
States. Real GDP would drop by about 5 percent over the next year, comparable
to the effect of a typical business-cycle recession. In the second, milder
scenario, one similar to the 1957 and 1968 pandemics, about 75 million
would become sick in the United States and about 100,000 would die. GDP
would drop by about 1.5 percent but would not cause a recession.

For more information on the avian flu, flu pandemics and preparedness
or response plans, visit:

Women-Owned Firms in Indiana: 2002

The Census Bureau recently released the 2002 Survey of Business Owners:
Women-Owned Firms report. Nationally, women-owned businesses grew at
twice the national average between 1997 and 2002. The 6.5 million firms
brought in about $950 in sales and receipts.

In Indiana, 118,857 women-owned firms, roughly 27.4 percent of all businesses
in the state, generated almost $16.5 billion in revenue. The 16,218 firms
with paid employees employed 136,457 people (see Figure
2).